Interesting combination, doncha think? Howzat all gonna show up by next spring?
People have been slowed, isolated and/or locked down for well over a year and not-so-much because of official mandates from the authorities – people just kinda shut down on their own. Even the anti-vaxxer, disease-flaunting, deniers of authority and logic have been somewhat shutdown simply because so many others are. And every time they open another restaurant, school, a stadium or a motorcycle rally town, the numbers just climb higher.
The USA has suffered over 600,000 deaths since Covid arrived and still adds over 120,000 new cases every day. Canada has had almost 28,000 deaths in total and gets 5000 new cases every day. And the governments continue to relax restrictions! That is unnerving, to say the least, and portends a bleak winter by simply projecting the numbers.
But what does it really mean? What happens when the world runs on fewer cylinders? It would seem that food and energy imports are amongst the first to feel the increased demand when supply chains are already reduced and labour is mostly AWOL. So, those prices go up and those inventories are strained. Example: (two weeks ago) my daughter and wife went to the neighbouring island, split a sandwich and had a milkshake each, before coming home. The bill was $30.00. Earlier in that day, my daughter sat at a coffee shop and had a toasted bagel and a Chai tea. The bill was $20.00.
Covid is going to get more expensive.
And fewer children are attending schools. More children at home means more parents at home. More unemployed. More debt. More handouts. And that means less GDP. So currencies will likely drop in value as does the country’s economy.
The above two paragraphs suggest stagflation – reduced growth or even shrinkage of the economic output while prices are still going up on the fewer and fewer who can afford them.
Mind you, real estate is still going up in value. New cars cost more. So, it is not all linear, predictable or logical. In fact, it is kinda crazy, if you ask me.
If you dig a smidge deeper, nurses and doctors are fading. Some are quitting or restricting their output and still others are going on ‘leave’. The healthcare line of defense is weakening. Already normal operations and other pressing health issues are being affected by the demands of Covid and the staff are burning out. That is not good. If our healthcare professionals are our first line of defense, then we are truly in trouble because we do not really have a second line. Well, there is Ivermectin and Hydroxychloroquine but, for most people, those options are unacceptable. Same for injecting bleach…..
But I must say, I am encouraging of Trump to hold more rallies and hope he continues to advocate for injecting bleach. Preferably in Sturgis, Florida and Texas. Maybe a guest rally in Alberta? Free bleach and Ivermectin!
But solutions aside, what other impacts are we gonna feel over this continuing Covid problem? Well, taxes have to go up. Trudeau and the other so-called leaders have been spending big-time to ease the viral discomfort as they try to keep the ship steady-as-she-goes but that bill is exorbitant and we could not afford that kind of largesse even that one time – twice will be impossible.
Anything else? Well, the effects of Covid (and our response to it) are continually surprising us so more surprises is a logical prediction. The desire to deny science and to favour conspiracy theories and false orange-hued idols is also a trend that is unpredictable. How can that madness manifest more in the future?
Put more succinctly, the Covid Party is not over. In fact, it is just getting started. When it started (early 2020), I predicted the USA would suffer 750,000 deaths. They are not there yet but I fear my prediction was overly optimistic. I also suggested that, surprisingly, Covid might be our TEOTWAWKI (the end of the world as we know it) and that is even more of a possibility now.
What do we do? Well, Sal and I will carry on carrying on. We are just finishing the new shed. See pics next blog. We won’t go to Costa Rica or Thailand this winter. We’ll hold down the fort again and hunker-in-the-bunker. Right now, it does not feel inviting in any way to go anywhere.
Do you think that will change anytime soon?
In Belgium, fortunately numbers are a lower (but then again we are a much smaller country). Doctors and nurses have a 30% dropout rate (burnouts mostly), so our first and only line of defence is also under a lot of strain. A lot of “less critical” procedures in hospitals have been postponed for over a year now, so for sure that will also increase the number of deaths. Vaccination level fortunately is vey high (75 to 85%) and +65 year old people will get a 3rd booster shot soon. Life is slowly getting back to normal with most restrictions lifted as from october 1st….so in about 3 weeks we will see the effect of that. Probably a Covid passport will be mandatory for restaurant/hotel/cinema/museum/….
Econoic activity has picked up and a growth of 3% is predicted for 2022. Prices are sky high for about everything and climbing each week, so a crisis is in the making. Real estate becomes virtually impossible to buy (unless you have rich parents), but still prices are climbing, so I expect that bubble will burst soon
We went on vacation to France by car this year in a very remote small fishermans house, far away from everybody
I expect not much change in the coming months, unless the 4th wave will hit us or a major economic crisis will hit (I predict another 6 to 9 months before all hell breaks lose)
Take care, stay safe and hopefully you have plenty of wood to get you through the winter
Looking forward to the pics of the shed!
Things will carry on as before or they won’t (duh). Hard to say. But there is more and more ‘insurrection in the USA’ and that portends ill. Trump seems to somehow be ‘re-emerging’. 61% of Republicans believe STILL that the election was stolen!!! And, of course, TEOTWAWKI can be triggered any number of ways. Covid + Trump + economics + China + misinformation + Murphy and the Surprises + Climate change suggests some kind of weird outcome might come from all that. I hope not. But…well, I kind of think it might. Nine months, you say?
Because of the enormous increase in prices for, well, about everything, I see signals that people will start to postpone purchases untill prices go back to a normal level. In my line of business, I had a big meeting yesterday where most of my customers were present. Because of price increases of raw materials and components (and long delivery times), we had to increase prices of our end product with about 10 to 15%. And we and our competitors are getting more and more signals that our clients will postpone new investments for th time being. I hear the same rumors in other industries as well. So if this will happen all over the industry, then demand will fall and a crisis will hit us full force. But maybe then prices will drop to a more normal level??
But can we afford another crisis, giving the huge deficits our governments have because of Covid?
Far be it for me to be an economic optimist (I am not) but the way of the Capitalist world is simply cyclical. Everything goes up and some things go up first but then every one catches up (except the poor, marginal, unemployed and such). Once in a while everything goes down but, if you can get back in, everything starts going up again.
And so it goes. Lumber goes up and then restaurants go up and then shoes go up and then some group strikes so their wages can go up. They are all chasing some kind of elusive equilibrium that is constantly thrown off by fashion, commodities, wars, pandemics and the like. The magic of business is to be in a recession proof industry (food, gasoline, sex, funeral homes, healthcare, etc) and just ride along cranking up prices so you can pay your mortgage.
Some industries suffer short term so a company needs a war-chest to last out the droughts. But droughts and famines are supposed to cull the competition so, when you come back, your market share is bigger. It’s all mostly predictable on a macro scale, almost impossible on a micro scale.
When I was a sailor and living on my boat, I calculated that f’glass boats cost per pound virtually the same as a pound of good steak. Twenty loaves of bread were worth a pair of shoes and so on. I watched that weird phenomenon stay pretty true for a long time until I lost interest. The point is, tho, everything is relative – if not now, then by next year.
I think Covid will rear its ugly head even more this Fall and Winter. More deaths , more bad headlines.
But it will eventually pass.
Much bigger problem and with social, political and generational problems.
In the last ugly recession, the West was younger, less in debt and ( in my personal opinion) more resilient.
The majority are hanging on by their fingernails financially.
Debt is way , way, WAY to easy to get and if interest rates rise ( and they will) and inflation follows…..ugh.
And kids run to their parents for loans, free accommodation and praise….for nothing.
People stop buying, stop going out, stop spending money…….(and Covid certainly doesnt help) we could see a Japanese style , deficit budget after deficit budget, 30 year financial slowdown, kick in the teeth. . all as 30% of our population reaches 65 and wants to retire.
65 year olds with no pensions, little savings and higher taxes to pay for govt employees that have gold plated pensions for doing the same job.
Social upheaval….count on it.
Can’t argue with that but am asking for the details….what, exactly, does social upheaval look like? More made-for-TV protests? Cops killing more uncooperative people?
More gang warfare? People jus’ gonna OD more? Or tattoo up even more?
More lawsuits on alleged crimes like “He said dirty things to me thirty years ago but a million dollars should set it right”? What is social upheaval in the future when normal heaval is so bloody stupid right now?
Seriously, you are witnessing something like 70 million Trumpsters – isn’t THAT a form of social upheaval? And it is happening right now, not in the future. And exactly what does 70 million idiots walking around mean to the rest of us? Is that like strolling barefoot amongst the rattlesnakes or simply walking away from the Lemming parade?
I guess what I am saying is, ‘I do not know what social upheaval looks like’.
No ideas, but I’m guessing Mendoza is out for the foreseeable future!
I’ve been checking. Got confused. Seems Chile (fly to Santiago, rent motorcycle, Che my way across the Andes, land in Mendoza) has been hit hard by Covid and yet their economy was reported as the fastest growing in the world!? Does that make any sense?
Another 10 years, and I’m eligable for pension (well, actually 12 more years as the government increased the pension age to 67), but as NonCon says, what if I end up with virtually no pension after having contributed for 45+ years? A lot of retired people will be in big problems!!
Not real problems, Wim, just a few emotional ones. Fear, insecurity ignorance. 45 years of working will result in some accumulated wealth, more than enough to eat and stay well. Your car won’t be new, your clothes not fashionable and you might have to downsize to a smaller village but life will go on. In my experience, it has been much much better. In fact I wouldn’t go back for any amount of money. If you are 90, alone, sick and destitute, maybe. But 90 year olds don’t spend a lot of money. A cabin will be fine. .The retirement ‘goals’ they set are stupid, wrong and only serve financial planners.
I work with 55, 62 and 68 year olds that rent, live pay cheque to pay cheque and STILL spend money on frivolous crap ( $800 shoes was the latest purchase.).
One 70 year old “friend” phoned me up the other day asking for a $5000 “loan”
“I’ll pay you back in 60 days.”
“How”? You have no job and the last time I loaned you $5k it took 14 MONTHS to get repaid with no interest. Sorry I’m not a bank”
“I thought you were a friend”
“Friends dont ask friends for $5000 loans….twice”
Financial ignorance in todays populations is rampant.
“How to Balance your personal budget” should be taught in school.
At least the politicians should be legally obligated to balance a fricken budget
And the Trudeau govt seems to want to spend tax money they haven’t even collected yet to reward that ignorance.
Hundreds of Billions burned on the bonfire of our Prime Ministers manic fantasies of a “budget that will balance itself”.
The population of tomorrow?
They wont be living in a cabin in the woods….. they will be living in a mouldy, illegal, basement apartment eating cat food.
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You are probably right…..for most people….basement with cats….but, but, but, someone who has worked all his life (like Wim) might find themselves stretched a bit thin when ‘eased out’ but still living in the city. City living is expensive. That same ‘stretched thin’ unemployed senior (with some net worth) would be comfortable in a small town……jus’ sayin’….and, someone like me (had a job since I was 11 when I bought my own delivery bike on a payment plan), I had enough to GET OUT and build a cabin. Honestly, I know I harp on it but living OTG is way cheaper once you are established. Knowing what I know now, I would not be worried being an urban senior, unemployed, renter but with SOME modest nest-egg. I would simply get out of the rat race and head points rural.
You are right, and my inner voice says the same…get out…but…
Wim, a suggestion offered very respectfully……why not look to somewhere remote that you can get to within a day’s travel? NOT a flight. Not a train. Some little village, some little hamlet you can drive to but somewhere as remote as possible in Europe. Just go for the weekend to the nicest, smallest place you can find. Albania? East Germany? Denmark? A close-by island in the Baltic? Don’t buy. Don’t even plan on moving there….just go there for awhile…see if the pace suits you….see if the small town appeals. If it does, then a world of choice is available – pick and go anywhere….even Canada……
But the first thing is to visit and experience an off-the-beaten path small, quiet, picturesque slice of rural living….see if it resonates… jus’ sayin’….
Well, to be honest, we did just that last year. I found a nice tiny house in a very small hamlet in France, isolated from the rat race. We spent 2 fantastic weeks over there, completely calm and quiet. My wife also loved it. She suggested to go back there next summer for 5 weeks, but we settled for 3 weeks (you know rat race…). But the isolation, calm, nature appealed to us both. And yes, we probably could live there on a lot less. I even will take up fishing again next year (I really like fishing). So maybe we are slowly preparing our exit out of the rat race. I recognise a good and very well meant suggestion when I hear one. Actually, the first “suggestion” was your book, afterards there have been a lot of suggestions in this blog. So thank you JD!
Re Mendoza! I’m double vaxxed! What’s to worry over? ‘cept I haven’t been on a motorbike in 60 years! Doe’s Sally ride? What are you planning to do with us as you ‘che’ over the Andes? Ship the odd case back to Santiago?
It won’t be the same without you!
Sally rides on the back holding on tight and occasionally screaming (for no good reason). Makes me laugh. She declared earlier in the planning stage that she would not be riding pillion if I rode across the Andes. She’d take the train. But I know Sal. She’s an adventurer. She’ll ride on the back and scream all the way to Mendoza. It’ll be fun. But it is not Chile or the m/c that is deterring us. It is the border chaos and the restrictions various countries impose. Plus, I will simply not go to the US. A direct flight to Mexico City, a week there to catch up on old times and then a direct flight to Chile was the plan. Then from Santiago to the m/c rental store. But it can all stay as a plan for now.
My brother and his wife spent 3 months travelling through south America.
Learned a bit of Spanish to get by before he left.
Started in Bogota and went down the west coast and returned up through the east coast ( with a few Amazon jungle detours along the way).
He didnt drive
Took the bus.